Dude If u read their past posts, they said the will be making a resolution update. That does not affect a 2d platformer done retro style. Read more on resolution since it seem that you have no idea how it works. *facepalm*

So, this discussion started on Febuary... and it's still not updated? In that case, it's a shame because I was considering to buy it. And yes, 720p is lame, specially nowadays, doesn't matter how pixelated or blocky are the game's graphics intended to look like.

i play on a 40" tv so 720 is kind of odd makes it big and kinda blurry

This is your TV's fault, it's blurry because your TV is trying to upscale it. Turn off the post-processing features.I would like it natively scaled to 1080p if only to have more room to use the Steam overlay.

Alternately you could try running it fullscreen and turning off your monitor's interpolation. 2560x1440 is just twice 1280x720, after all. So every pixel in the game would get turned into 2x2 pixels onscreen.